L.A. Budget Czar Miguel Santana’s Shaky Math and Polarizing Ideology

For days before Thanksgiving, 2009, Santa Ana winds had been blowing up ash and dust from the massive Station Fire that recently burned north of Los Angeles. The scorching, high-pressure weather system seemed a suitable climate for L.A.’s financial meltdown as the city entered the third year of America’s recessionary slump. Inside City Hall on that Wednesday before the holiday, government representatives and members of the news media listened to the testimony of a man who was on his way to becoming one of Los Angeles’ most powerful figures. He was only 40, held no elective office and had started his job as the City Administrative Officer just three months before.

Yet on this Thanksgiving eve Miguel Santana held the rapt attention of the City Council and journalists as he delivered shocking news: Los Angeles faced an imminent shortfall of $98 million and, based on his projections, the city could be burdened by a $1 billion debt by 2013.

One billion dollars. The city had two choices, it seemed: It could try to maintain its current level of services and die a slow, painful death, or it could submit to radical surgery and stay afloat; Miguel Santana would be the surgeon. The announcement jolted city government, which had no experience in managing such an economic calamity, into accepting remedies that Santana, who is the city’s top budget officer, would soon propose – remedies that resulted in draconian austerity measures, the dismissal of about 5,000 city workers and renegotiation of employee pension and medical benefits.

In the following four years Santana would deliver more doomsday predictions: that bankruptcy lurked around the corner; that approval of a ballot measure to inject money into the city’s libraries would blow open a $6 million budget hole, and that the city would lose 500 police officers unless voters passed a regressive sales tax. A 2012 report by Santana scolded the City Council for relying on one-time budget fixes and warned that ignoring his proposals could send Los Angeles down the same road as Stockton. By invoking the name of that bankrupt San Joaquin Valley city, Santana helped spread a fear of insolvency in City Hall. Yet despite Santana’s warning of bankruptcy, last April Mayor Antonio Villaraigosa proposed a budget for Fiscal Year 2013-2014 that included a one-time surplus of $119 million. While some of that surplus would rely on additional pay and benefit reductions for city workers, even without such cuts the city would have a projected surplus of close to $100 million.

Throughout his tenure, though, few in City Hall or in the media have questioned the veracity of Santana’s predictions or, for that matter, Santana’s competency. After four years Santana’s reputation as a straight-talking technocrat remains intact. He may very well, in fact, be reappointed by incoming Mayor Eric Garcetti to his current position, from which he has consistently portrayed Los Angeles’ future in the bleakest terms imaginable.

Veteran City Hall observers say Santana has injected politics and his personal ideology into the CAO’s office, acting more as an antagonist than a neutral fact-finder on progressive ordinances involving banking transparency and waste-hauling reform – all the while doggedly exaggerating L.A.’s financial problems. Rather than serving as an objective presenter of facts to the Mayor and City Council, they say, Santana has pushed hard for solutions predicated on slashing city services and privatizing city functions.

“From the beginning of the financial crisis, he’s adopted a posture of instilling panic into elected officials,” says one City Hall insider who, like several sources interviewed for this article, requested anonymity. “He doesn’t respect the city or its officials enough to tell the truth. It’s a game of brinkmanship – ‘My way or bankruptcy.’ He’s done damage to the city by beating the bankruptcy drum instead of looking for rational solutions.”

Santana’s supporters deny these charges and say that he has done a good job during extremely difficult economic times.

“I’ve watched this poor guy get beat up,” says Keith Comrie, who served as CAO from 1979 to 1999. “You don’t go through the worst recession without huge problems.”

Perhaps most important, Santana also appears to have the support of City Council president Herb Wesson, who has said that he would fight any efforts to remove Santana. The Council has the authority to override any move by the Mayor to replace the CAO.

The City Administrative Officer is appointed by the Mayor, and reports to both the Mayor and City Council. The position has been filled in the past by influential and respected officials, including Comrie, C. Erwin Piper and Bill Fujioka, L.A. County’s current Chief Executive Officer. For the system to work, the CAO must present the facts of the city’s financial picture in an impartial manner, so the Mayor and the Council can make informed decisions.

“People have to believe in the CAO’s numbers,” says Raphael Sonenshein, executive director of the Edmund G. “Pat” Brown Institute for Public Affairs at California State University. Sonenshein, who has served as executive director of the Los Angeles Charter Reform Commission, says the office of the CAO is little known to the general public but crucial to the efficient working of city government. “I think it’s quite important,” he says. “Hopefully, [he] brings professionalism and analytical skills to City Hall.”

Critics, including many in the labor movement and others inside City Hall, say that Santana’s job performance has been lacking, and they urge an open debate about whether he should continue in the job. Specific allegations include:

Inaccurate Financial Projections – When trying to sell Measure A, the proposed half-cent sales tax increase, Santana earlier this year released a report titled “City at the Crossroads,” in which Santana appeared to overstate the consequences of not passing the measure. He said cuts to public safety would be “unavoidable,” warning of the loss of 500 police officers as well as cuts in park hours and closure of swimming pools. He also said the city faced a budget shortfall of almost $220 million and that the sales tax hike would erase the majority of it. In February, less than a month before the crucial vote, a former budget advisor to Mayor Antonio Villaraigosa told the Los Angeles Times that Santana’s warnings were exaggerated. “If we’re making an argument that failure to pass a tax increase will result in drastic cuts, then the numbers the city uses had better be accurate,” said Matt Szabo, during his unsuccessful campaign for Eric Garcetti’s Council seat. “And I don’t think they are. The question people need to ask is, is [the shortfall] being overstated for the purpose of passing the sales tax?”The day after Measure A failed, Santana clarified that the actual deficit was only around $108 million – and that it was unlikely the city would lay off any police officers. Critics say that Santana intentionally exaggerated the proposed deficit for the purpose of trying to pass the sales tax increase, an inappropriate use of the CAO’s office.

Failure to provide accurate financial information to the Mayor and City Council – Critics say that before the Mayor submitted his 2013 budget, Santana knew of, but failed to report nearly $49 million in additional revenue to the city. The majority of this amount, $31.4 million, came from increased property tax revenues due to the statewide Community Redevelopment Agency dissolution, and was based on recent estimates from the state Department of Finance. Santana’s opponents say he should have known this windfall was coming, if not its exact amount. They claim he could have made an accurate projection by talking to state finance officials and reporting that to the Mayor’s office.

Inaccurate reporting of federal economic stimulus data to the City Council – An audit by the city controller’s office, dated April 11, 2013 found that Santana’s office delivered inaccurate data to the City Council relating to federal economic stimulus grants to the city’s bureaus of Sanitation and Street Services, and the Department of Transportation, with a systematic underreporting of costs. Among other things, the audit shows a failure to source appropriate documents and an inability to uniformly manage communication within departments. “Especially during this time of staffing and budget challenges,” the audit states, “the City cannot afford to compromise ARRA [American Recovery and Reinvestment Act] grant funds that have the potential to provide significant benefit to our local economy.”

Failure to aggressively pursue new revenue opportunities – Santana’s detractors claim he has also failed to aggressively pursue new sources of revenue, including millions of dollars in potential revenue identified by the Commission on Revenue Efficiency. One CORE report found that the city loses an additional $21 to $25 million a year in revenue because rogue parking operators who collect the money from customers fail to turn it over to the city. Critics say Santana has failed to move quickly enough to collect an estimated $60 to $80 million owed to the city that is collectable and has ignored calls to centralize the collections process.

In an interview with Frying Pan News, Santana vigorously defended his job performance.

“We didn’t know about it at the time because it’s a very unpredictable and uncertain process,” he said of the windfall resulting from the CRA’s dissolution. Among other things, he said he has provided accurate financial information, analyses and recommendations to the Mayor, the City Council and the public.

“The city has gone through this traumatic period,” he said. “We were in a very dangerous place four years ago and we’ve made slow and steady progress. There’s no exaggeration – the facts are what they are.”

Talking about his support for the controversial sales tax hike, Santana said, “Had Measure A passed, the structural deficit would have been eliminated and we’d be talking about restoring services in a significant way.”

Referring to himself and his staff, he said, “We feel very proud of the work we’ve done.”

In addition to the criticism of Santana’s projections, he has faced scrutiny over his role in labor negotiations and his difficult relationship with union leaders. While it’s not unusual for CAOs to have a rocky rapport with labor, Santana’s dealings with union leaders seem exceptionally contentious. During the Mayor’s race union officials pushed the candidates to state whether they would retain Santana if elected. None of the candidates, including Eric Garcetti, declared at the time that they would choose a new CAO.

City Hall sources say that questions have been raised about Santana’s effectiveness. In early 2011, with labor talks stalled, responsibility for the negotiations were quietly transferred to officials in the Mayor’s offices and then council president Garcetti’s office, according to one insider. An agreement was reached with labor in March 2011 that called for thousands of city workers to increase their health-care and pension contributions in exchange for an end to furloughs caused by the financial crisis.

Santana acknowledges that he has had an up-and-down relationship with labor.

“Overall, my relationship with labor is that what normally exists between management and labor . . . There’s always moments in time when each side is not happy with each other.”

Beyond his contested financial projections and controversial relationship with labor, Santana has also come under fire for his aggressive efforts to privatize government operations. Typically in such scenarios, government gives control of public functions and services to a private company. A city or state pays a private company to perform public services. Supporters of privatization claim that private companies can be more efficient. Opponents say there is no evidence of this and that there are serious risks involved.

Privatization means giving up important controls and safeguards, as well as transparency over public functions. Also, once the service is privatized, the public loses its ability to examine crucial information relating to that service – andis shut out of the decision-making process. There are numerous documented examples in which privatization has resulted in diminished services, cost increases, reduced access to services and inadequate safeguards against corruption.

Santana says he believes that certain city services and functions – particularly the zoo, Convention Center and ambulance billing and collection – can best be performed by the private sector:

“If you look at what’s most successful, in terms of zoos, 80 percent are run by private foundations . . . The three most successful [convention centers] are privately managed.”

“It’s not a wholesale agenda to privatize government,” he says of his economic strategy for L.A. “I’m the biggest believer in government. My whole career has been in public service and government. I believe government has a big role to play. I also understand we have limitations.” He said that privatizing selected operations such as the zoo and Convention Center would better allow city government to focus on its core services, including public safety, libraries and quality of life services.

Steve Koffroth, a business representative for Council 36 of the American Federation of State, County and Municipal Employees (AFSCME), is critical of Santana’s privatizationproposals.

“His efforts to contract out shows he is willing to sacrifice protection of public services for profit,” says Koffroth. AFSCME Council 36 represents public sector workers in Southern California – many of whom in the city of Los Angeles have been directly affected by Santana’s positions.

As the new Mayor prepares to take office, one of his key decisions is whether to re-appoint Santana as the city’s top budget official.

“I report to both the Mayor and the City Council,” Santana said. “Part of my job is to raise issues and make recommendations that are often difficult for them to confront. Some people may criticize the messenger in that process. At the end of the day, I’m not the one that makes the final decisions.”

AFSCME’s Steve Koffroth remains unconvinced that incumbency should be its own reward.

“The question in my mind about keeping Santana in that position,” Koffroth says, “is whether he is really there to serve the public good.”

How Big Oil Spiked Jerry Brown's Climate Change Agenda

As Governor Jerry Brown touted California’s environmental initiatives and prodded world leaders in Paris to embrace tougher environmental policies during the United Nations summit on climate change, it was instructive to look back at how one of Brown’s top environmental priorities suffered a major defeat in the California Legislature this year.

That priority was to establish a 50 percent reduction in petroleum usage in cars and trucks by 2030. Brown’s failure to win its passage in an overwhelmingly Democratic Legislature clearly illustrates not only the influence of the fossil fuel lobby, but also the continued rise of a new breed of Democrats who are exceedingly attentive to big business, while tone-deaf toward their party’s traditional progressive base.

Petroleum reduction was a key part of a proposed law, introduced as Senate Bill 350, which also called for steps to increase energy efficiency in existing buildings and require that 50 percent of California’s energy come from renewable sources, such as solar and wind. By any definition SB 350 was a landmark piece of legislation. It had the rock-solid support of environmentalists, numerous health and physicians groups, and two Nobel Prize winners.

In hindsight, however, it probably didn’t stand a chance, thanks to an intense, summer-long lobbying campaign and media blitz by Big Oil and others. State filings show that oil companies and their trade organizations opposed to the petroleum reduction measure spent $10.7 million in the third quarter of 2015 to lobby lawmakers and conduct a negative media assault. Of that, the Western States Petroleum Association, an influential industry trade group, spent $6.7 million, more than twice as much as it had spent in the previous two quarters. Individual oil companies, such as ExxonMobil and Valero, also spent hundreds of thousands of dollars in the third quarter, a significant increase over the amounts they spent on lobbying earlier this year.

In contrast, among the bill’s supporters, NextGen Climate, an environmental group founded and headed by philanthropist Tom Steyer, spent nearly $1.2 million on lobbying in the third quarter.

By late summer, the industry’s lobbying campaign and media blitz attacking SB 350 had had a big impact. Faced with defections by a group of nearly 20 so-called moderate Democrats, led by Fresno Assemblyman Henry Perea, SB 350 backers reluctantly removed the petroleum reduction measure. The move followed two critical meetings between supporters of the bill and the group of about 20 moderate Democrats concerned about the petroleum reduction measure. At the first meeting, on August 24, the moderate Democrats, led by Perea, met with then-Assembly Speaker Toni Atkins (D-San Diego). At the second meeting, on August 31, the same group met with officials at the governor’s office. (Perea announced this month that he is leaving the Legislature a year before his current term expires.)

Many of the corporate-friendly Democrats who attended those meetings with Atkins and Brown have received substantial campaign contributions from Big Oil over the years. Perea, for example, has received almost $100,000 in campaign contributions from the oil and gas industry, while Merced Assemblyman Adam Gray has received about $80,000 and Rudy Salas, an Assemblyman from Bakersfield, has received about $65,000, according to a story in the Los Angeles Times citing the National Institute on Money in State Politics.

On September 9, with only two days left in the legislative session, Brown, Atkins and Senate President Pro Tem Kevin de León (D-Los Angeles), announced they were dropping the petroleum usage provision from the bill. The California Chamber of Commerce, another powerful opponent of the measure, then removed its influential “job killer” tag from the bill, sending a clear signal to corporate-friendly Democrats that it was now permissible to support SB 350.

A watered-down bill soon passed, with all of the formerly recalcitrant Democratic lawmakers except Gray voting for it. Brown signed it into law in a ceremony in October at the Griffith Observatory in Los Angeles.

“The main takeaway regarding the loss of the petroleum reduction piece of SB 350 is that it allowed us to shine a bright light on unprecedented oil industry spending [intended] to protect their bottom line – along with the lengths some lawmakers will go to ignore what voters truly want, which is less dependence on petroleum,” Susan Frank, director of the California Business Alliance for a Clean Economy, tells Capital & Main.

The alliance, a network of 1,300 mostly small and mainstream companies in California that support a clean energy economy, was an important backer of the bill. Frank adds that it wasn’t a total loss, citing the stronger renewable energy and building efficiency standards that survived.

Les Clark, executive vice president of the Independent Oil Producers Agency, an industry trade group based in Bakersfield, says he was adamantly opposed to the petroleum reduction provisions of SB 350 because they would have significantly hurt anyone who produces oil, particularly the mom-and-pop operators he represents.

“We were opposed to it,” Clark tells Capital & Main. “If you produce oil, you are producing it to make money. Of course we’d be concerned about that.”

Clark claims the measure could have driven some smalltime oil producers out of business. “It’s not good for my neighbors to have to pack up and go back East to find a job,” he says.

In speaking against the petroleum reduction measure, the bill’s opponents warned that it could result in gas rationing and prohibitions on sport utility vehicles. Opponents, including some Democratic lawmakers, also claimed that cutting petroleum use would be disproportionally harmful to residents of the Central Valley, whose long commutes and dearth of public transportation make dependence on automobiles – and fuel – a certainty.

“In the Valley – more than anywhere else in California – that means reducing jobs, businesses and opportunities,” Assemblyman Adam Gray wrote in an opinion piece published in the Merced Sun-Star. “The Valley’s No. 1 industry, agriculture, is dependent on transportation by both trucks (produce) and cars (labor). We have some of the highest levels of poverty and unemployment in the nation. Yet SB 350 puts these disadvantaged communities first in line to pay more and offers nothing in return.”

Sarah Rose, chief executive of the California League of Conservation Voters, disagreed, and in an interview confirms that the opposition of several key Democratic lawmakers to the petroleum reduction measure appears to have been motivated more than anything by a desire to please Big Oil.

“Clearly, there’s a problem when you have legislators not voting in the best interests of their constituents,” says Rose, whose organization supported SB 350.

“Oil has won a skirmish,” Brown conceded at the September 9 press conference, while de León added that the measure’s proponents were unable to compete with Big Oil’s “bottomless war chest.”

Now, three months later, after the governor promoted California’s accomplishments in a weeklong series of events at the Paris climate change conference, Brown can only look back and regret what was clearly a lost opportunity in Sacramento.

Paradise Burned: How Climate Change Is Scorching California

Paul Duncan, a battalion chief with California’s state firefighting agency, was at home in Northern California enjoying a day off on September 12 when he got the message: A wildfire was burning on Cobb Mountain, about a dozen miles away from Hidden Valley Lake, where he lived with his wife and two daughters.

Duncan, 46, decided to leave and help knock down the blaze because he knew the fire unit in the area was already short-staffed from putting out on another conflagration. Besides, his nearly 30 years of experience persuaded him there was no way a fire burning on a mountain to the west could burn down to the valley floor and then race eastward to threaten the Duncans’ home.

His optimism was short lived. Upon arriving on Cobb Mountain Duncan got some troubling news. The fire he was fighting was heading toward his family. At 5:13 p.m. he texted them: “The fire will be encroaching on Hidden Valley within an hour.”

His family escaped safely, but they were later faced with having to drive through fire on the roads. At 6:37 p.m., Duncan texted a message to his family he never imagined he’d have to send.

“If you have to drive through fire, keep your lights on, turn on your flashers and KEEP MOVING.”

Ten minutes later, his wife, Courtney, called in a panic — there was too much fire to drive through. Duncan reassured her and told her to “step on the gas and drive through the fire.”

“This was a ferocious fire, wind-driven in brush, moving about 25 to 30 miles per hour,” Duncan would later tell Capital & Main, after his house had burned to the ground. “I’ve never seen this type of fire behavior, especially this far north in California. It came with a speed more like a Santa Ana fire in Southern California.”

The September inferno was dubbed the Valley Fire and it killed four people, destroyed 1,958 homes and other structures, and caused $1.5 billion in damages. Its name would join a lengthening roster of mega-blazes with names like Witch Fire, Station Fire, Rim Fire and Butte Fire. For firefighters these represent a new kind of fire that is devastating California and other states west of the Rockies. To climate and environmental scientists, they are evidence that global warming is creating a new and vastly expanded fire danger to the West.

California is facing the gravest threat to its natural beauty on record but many of us view the state’s expanded fire season as a cyclical anomaly – a belief sometimes spread by the mainstream media. A recent Los Angeles Times feature, provocatively headlined, “Gov. Brown’s link between climate change and wildfires is unsupported, fire experts say,” appeared to suggest that Governor Jerry Brown’s linkage of climate change to wildfires was politically motivated and had no basis in science. The Times story and some of its expert sources were quickly attacked by scientists and the watchdog group Media Matters for America, but the damage had been done by planting doubt in the minds of the newspaper’s readers.

Despite the Times’ inference that global warming plays a limited role in wildfires, the science is in and the picture it paints is ominous:

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California is now losing nearly 90,000 acres a year (equivalent to the size of Las Vegas) to wildfires that have been increasing in size since 1984, according to Geophysical Research Letters.

A report published in Ecological Applications concludes that 64 percent of the fire area burned by wildfires on public lands in the Western United States can be directly related to climate variables such as temperature, precipitation and drought.

According to a Union of Concerned Scientists report, the annual number of large wildfires on federally managed lands in the 11 contiguous Western states has increased by more than 75 percent – from about 140 large fires during the period from 1980 to 1989, to 250 large fires between 2000 and 2009.

Max Moritz, a University of California, Berkeley environmental scientist who has studied wildfires for decades, tells Capital & Main, “Climate change is taking its toll. There is a likely link between climate change and the sizes and spread rates of this year’s wildfires.”

There are still doubters, however. Dismissing what he called “climate alarmism,” David South, a retired emeritus professor of forestry at Auburn University, told a U.S. Senate Subcommittee last year that the conclusion that global warming has caused more wildfires is simply wrong. He added in an email to Capital & Main that “the average area of wildfires burned during the 1930s was much higher than the average for the first decade of the 21st century . . .This does not support the hypothesis that carbon emissions have increased the area of wildfires annually.”

Nevertheless, those who fight wildfires on the ground say there has been a dramatic change in California’s fire behavior over the past decades.

“The fires are hotter, the fires are burning faster and they are consuming anything in their paths,” says Mike Lopez, who has been battling fires since the early 1990s and is now president of Cal Fire Local 2881, a union representing more than 6,000 firefighters. Adds Kim Zagaris, fire and rescue chief at the California Office of Emergency Services: “We are seeing longer fire seasons than I’ve seen in my 38 years.”

Again, the science backs up the firefighters’ observations. Last year’s Geophysical Research Letters study implicated “climate change as a prominent driver of changing fire activity in the Western U.S.,” and concluded that such wildfires have been getting bigger and more frequent over the last 30 years. This development is likely to continue as climate change causes temperatures to rise and droughts to become more severe.

By virtually all accounts the length of the wildfire season in California and the Western United States has grown. According to a report by Climate Central, an organization that studies changing climate and its impacts, the Western wildfire season has grown from five months on average in the 1970s to seven months today. During those years temperatures for spring and summer have risen and, Climate Central reports, mountain snowpacks are melting earlier, which leaves forests drier for longer periods of time.

Scientists and research studies also point to related problems, such as the fact that the warmer temperatures contribute to beetle infestations that, in turn, cause trees to die and potentially cause wildfires to burn more quickly. The U.S. Forest Service, for instance, says that from 2000 to 2013, bark beetles killed 47.6 million acres of forests in the Western United States—an area roughly the size of Nebraska. The warmer temperatures have allowed the beetles to survive longer and reproduce more, resulting in record epidemics. They are now able to infect higher-elevation pine trees. In California alone, an estimated 12.5 million trees have died during the drought, with many of the deaths attributed to beetle infestations.

Paul Duncan with son and daughters.

Paul Duncan says he believes that pine trees killed by beetles likely helped contribute to the rapid spread of the fire that destroyed his home.

The economic consequences of the recent wildfires have clearly been catastrophic.

In its “Global Catastrophe Recap,” reinsurance broker Aon Benfield of London detailed the human and property losses of that and other recent California wildfires.

“Multiple wildfires raged across California during much of September, with the Valley Fire, northwest of San Francisco, and the Butte Fire, southeast of Sacramento, the most destructive of the fires,” the study stated. The Butte Fire erupted in the Sierra Foothills September 8 and left two people dead, while causing an estimated $450 million in damage.

This year’s California wildfires are part of a worldwide phenomenon. The Aon Benfield report notes, for instance, that “Wildfires continued to burn in Indonesia’s Sumatra and Kalimantan regions as the worst year for wildfires since 1997,” causing an estimated $4 billion in losses in terms of lost agriculture production, destruction of forest lands, health, transportation, tourism and other economic endeavors.

Scientists, firefighters, economists and government officials caution that the wildfires are likely to worsen. “The threat of wildfires is projected to worsen over time as rising temperatures – rising more rapidly in the American West than the global average – continue to lead to more frequent, large and severe wildfires and longer fire seasons,” states the Union of Concerned Scientists’ report.

The report also points out that the large wildfires have serious impacts on health and the economy that are often overlooked or underestimated. Smoke from wildfires carries small particles of soot that can enter the lungs and result in serious health problems. Young children, the elderly and people with asthma and other respiratory problems are at the most risk.

“We are in a different fire regime,” says Rachel Cleetus, lead economist and climate policy manager with the Union of Concerned Scientists, and co-author of the group’s 2014 study. “If we do nothing, we’re going to see wildfire season get worse and worse, get more costly and get more dangerous.” She says that the situation affects all of the Western United States, but is most urgent in California.

Can a Business-Labor Alliance Save California’s Infrastructure?

Lucy Dunn has a message for Republican lawmakers: Approve new revenue now to fix California’s decaying highway and bridge system or face severe economic consequences that will be felt throughout the state for decades.

Dunn is no big-spending liberal and you won’t find a Proud to Be Union bumper sticker on her car. In fact, she’s president of the influential Orange County Business Council and a card-carrying Republican. But to Dunn, funding long-neglected transportation maintenance and repairs is an existential issue for California’s business community.

“If you can’t move people and goods on safe roads and bridges, you cannot do business in the state,” Dunn tells Capital & Main.

This fundamental lesson was brought to urgent life in July, when a bridge collapsed along Interstate 10 during heavy rains, cutting off the main route between California and Arizona. While no one was killed, the incident underscored the fact that California’s highways, bridges, streets and roads are in desperate need of rehabilitation, repair and maintenance. According to the California Transportation Commission, the state currently has $57 billion in deferred maintenance and ranks 45th among the 50 states for overall highway performance.

One-quarter of local streets and roads will be in “failed” condition by 2022 under current funding levels. The estimated annual cost of deficient and congested roads, and traffic accidents in California is $44 billion – nearly $2,500 per motorist annually, the commission says. Furthermore, more than one-fourth of California’s bridges are in need of repair, improvement or replacement, 11 percent of the state’s bridges are structurally deficient, and 17 percent are functionally obsolete.

“There clearly needs to be more money invested in transportation infrastructure,” says the commission’s executive director, Will Kempton. “It’s similar to taking care of a leaky roof. The longer you wait, the more it costs.”

Governor Jerry Brown has made transportation improvements a priority and this summer called a special session of the legislature to deal with it. Late last week he offered a plan for $3.6 billion in yearly funding that would partly be financed by a $65 fee for vehicle owners, an 11-cent hike in the diesel tax and a six-cent increase to the gas tax. Other money would be allocated from California’s cap-and-trade carbon emissions program.

The plan appears to have strong support among Democrats in Sacramento. However, Republicans, while generally agreeing that the state’s roads need to be fixed, have offered their own plan that vaguely calls for greater government efficiency and accountability, while specifically demanding layoffs of workers at Caltrans, the state’s Transportation Department. But no new taxes.

Even if all Democrats vote for new infrastructure taxes as the state legislature enters its final week of the current session, at least one Republican state Senator and two Republican Assembly members would be needed for passage because a two-thirds majority is required to raise taxes. Those Republican votes are far from certain. “Even in Orange County they’ve all signed pledges not to raise taxes.” acknowledges Lucy Dunn of efforts to persuade GOP legislators.

“Right now, I’m opposed to [new] taxes,” Assemblymember Rocky Chávez (R-Oceanside) says in an interview with Capital & Main. Chávez is an announced candidate to replace the retiring Barbara Boxer in the U.S. Senate. “Just saying ‘raise taxes’ is not a solution.” He adds, “I know there is a serious problem.”

Not even the state’s business leaders deny there can be a solution without raising taxes.

“We know money doesn’t grow on trees and funding has to come from somewhere,” says Ruben Gonzalez, senior vice president for public policy and political affairs with the Los Angeles Area Chamber of Commerce. “The business community has no problem investing in needs as long as we are given confidence the money we are investing is going to products and outcomes we were promised.”

Adding their voices to the infrastructure debate last month, a coalition of business and labor groups stated in a letter to Governor Brown and legislative leaders that “any package should seek to raise at least $6 billion annually and should remain in place for at least 10 years.” Coalition members range from the California Chamber of Commerce to the State Building and Construction Trades of California to the League of California Cities.

The fight over transportation funding highlights a growing political chasm between Big Business and its traditional Republican allies in Sacramento. It also raises the possibility that Republican lawmakers will torpedo historic investments in highway and bridge repairs and maintenance, to the detriment of the state’s long-term economic interests and their own districts’ needs.

Jim Earp, executive consultant for the California Alliance for Jobs, says that it is imperative to find a way to gain a few Republican votes. “We’re not trying to get the blessing of the entire Republican caucus,” he says. “We are really focusing on legislators who have districts [whose roads] are in particularly tough shape.” He declines to name any specific legislator whose vote is being targeted.

Proponents point out that raising revenue for the needed transportation fixes would create thousands of new jobs, because it takes men and women to fix the roads and provide engineering and other services. John Casey, spokesman for outgoing Assembly Speaker Toni Atkins (D-San Diego), says that studies show that every $1 billion spent on road improvements creates 13,000 to 15,000 new jobs. If $6 billion per year in new money is approved, that could create 80,000 jobs alone, he says.

Ruben Gonzalez of the Los Angeles Chamber of Commerce, agrees. “It’s the old saying. Time is money. If you don’t have good roads, you’re causing delays and inefficiency. That costs money – money that could be used to create jobs. This is all about jobs.”

In many ways, the current battle over transportation funding in California reflects the nationwide trend towards politicizing issues that were historically dealt with in a bipartisan way.

“To make roads and bridges safe, to make sure our ports can compete – these should not be issues that one party or another supports,” says Edward Wytkind, president of the Transportation Trades Department, AFL-CIO, a Washington, D.C. labor organization representing transportation-sector unions. “These are symbols of a modern economic power.”

How Democrats Mixed Oil and Water, Killing Environmental Bill

Hopes were high among environmentalists when a bill designed to protect California’s drinking water was introduced in the state Assembly earlier this year. After all, California has passed some of the most far-reaching environmental laws and regulations in the nation, and the state legislature is dominated by the Democratic Party, whose members are generally inclined to vote for tougher environmental standards. Moreover, California is in the midst of a massive drought, which gave the bill more urgency. And besides, clean water isn’t a threatened desert flower or endangered minnow – it’s something everyone depends on for existence.

It never had a chance.

The measure, Assembly Bill 356 (Das Williams, D-Carpinteria), was intended to protect underground sources of drinking water from oil and gas wastewater disposal and enhanced oil recovery treatments, and called for monitoring near certain injection wells. That immediately put it in the crosshairs of the most powerful oil interests in California, including the Western States Petroleum Association (WSPA), the California Independent Petroleum Association and the Independent Oil Producers Agency. The bill was also strongly opposed by the California Chamber of Commerce, which put the bill on its feared “job-killer” list.

“The Division of Oil, Gas and Geothermal Resources,” Williams said in a February statement, “disclosed on February 6, 2015 that 2,500 wells — more than 2,000 of which are active — currently are permitted to inject gas and oil waste or other fluids into protected sources of drinking water, in violation of the Federal Safe Drinking Water Act.” But when it comes to oil, there are times when the overwhelmingly Democratic California Assembly might as well be the Texas House of Representatives. On June 4, AB 356 came up for a floor vote and gained only 28 of the 41 yes votes needed for passage. Fifteen Democrats abstained, while nine Democrats went so far as to vote against the bill.

Neither Andrew Grinberg nor Jena Price, two of the bill’s staunchest supporters, were totally surprised. They told Capital & Main the vote reflected two intertwined trends: the immense lobbying clout of Big Oil and Big Business, and the increasing number and influence of Sacramento Democrats who tend to line up behind those interests, instead of looking out for the common good.

“It’s pretty depressing that most members of the Assembly put the interests of Big Oil ahead of California’s need to protect its groundwater,” said Grinberg, California Oil and Gas Program Manager for the Washington, D.C.-based Clean Water Action, a nationwide advocacy group. “Today’s vote was another indication of just how powerful corporate polluting interests are in Sacramento,” he said June 4.

In an interview, Grinberg said that the Assembly’s defeat on the groundwater monitoring bill reflects “a certain trend towards moderates in the Legislature having a lot of power.”

Many, if not most, of the legislators who voted no have received substantial contributions from Big Oil over the years. Henry Perea, Adam Gray and Jim Frazier, for example, each received campaign contributions in 2014 from Chevron Corp. or the Chevron Policy Government & Policy Affairs Committee, Exxon Mobil Corp., Occidental Oil and Gas Corp., and the California Independent Oil Producers Agency. And Perea was among a group of legislators treated by the WSPA to a $1,439 dinner at Spago in Maui.

Moreover, several of the Democratic lawmakers voting no on AB 356 have consistent pro-business voting records. According to a scorecard from the California Chamber of Commerce, Tom Daly voted in accord with the Chamber’s position on 12 of 14 votes on major bills in 2014; Jim Frazier voted in accord with the Chamber 11 times out of 14, and Perea and Cooley each voted with the Chamber 10 times.

On June 4 a total of 15 Democrats also abstained from voting, a move that helped kill AB 356 because 41 yes votes were required for passage – making abstaining a convenient way for Democrats to defeat the bill without officially opposing it. Indeed, Democrats sympathetic to corporate interests don’t always flex their muscle by openly supporting business-friendly bills or voting against bills opposed by corporations, but sometimes by doing nothing.

“Laying off a bill like this is as good as voting no,” noted Clean Water Action’s Grinberg.

Jena Price, legislative affairs manager for the California League of Conservation of Voters, says she pushed hard to convince Assembly members to vote for AB 356, but that the oil and gas lobby was simply too powerful.

”That was a troubling vote for us,” she says. “We knew this was an uphill battle. Every time I walk the halls of the Capitol, there are five to seven oil lobbyists for every one of me. Oil has a heavy hand in the California legislature.”

The industry, not surprisingly, saw AB 356’s defeat as a no-brainer.

“It’s about time some common sense has come in,” said Les Clark, executive vice president of the Independent Oil Producers Agency, in a phone interview from Bakersfield. “Number one, it’s not needed – to say none of that has been done is ridiculous – monitoring wells, [checking] where the water goes. When you produce more rules and more regulations and more taxes and more fees, all of that adds to the lifting cost to bring a barrel of oil out of the ground. It marginalizes profits.”

Records show that the oil industry almost doubled its spending on lobbying in California in 2014, with the WSPA alone spending about $8.9 million. In addition to lobbying money, the WSPA spends thousands on independent expenditures to try to oust lawmakers who don’t vote in accord with the industry’s wishes.

“A lot of people in the [Capitol] building were spreading the message [that] this was a job-killer bill,” Grinberg said, adding that the bill’s opponents were distributing floor alerts with misleading information and trying to create doubt in the minds of legislators in the days leading up to the vote.

In many ways, the defeat of bills like AB 356 is almost inevitable.

When California elected Democratic supermajorities in the state Assembly and Senate in 2012, many expected to see a new era marked by progressive policies on everything from the economy to education to the environment. While some change has come, it’s not been as extensive as many voters perhaps envisioned nearly three years ago.

One big reason for this has been the emergence of a new kind of Democrat who is not a traditional liberal or moderate, but an enabler of big developers, insurance companies, Big Oil and other interests.

This development has had an impact on issues across the board. For instance, last year a bill to raise California’s minimum wage was effectively killed after two Democrats – Luis Alejo of Salinas and Chris Holden of Pasadena – abstained during a key vote in the Assembly’s Labor and Employment Committee. Their abstentions meant that the bill did not get out of committee.

Another indication can be found in Assembly Bill 465, which is currently intended to ensure that no workers are required to sign waivers of their basic legal rights as a condition of employment. The bill, which deals with forced arbitration clauses and is on the Chamber’s job-killer list for 2015, narrowly passed the Assembly in May and is now pending before the state Senate. But the Assembly vote was far from an easy victory, after two Democrats (Merced’s Adam Gray and Jacqui Irwin of Thousand Oaks) voted against it and five other Democrats abstained.

To environmentalists, the failure to pass Das Williams’ groundwater monitoring bill was even more dismaying because the vote came just one day after the California state Senate passed a package of bills to address climate change, a top priority of Governor Jerry Brown’s administration. With the climate change bills likely to be passed, the oil and gas industry focused its energy on defeating AB 356, according to environmentalists. (The bill was granted reconsideration and can be brought up again next year).

“Unfortunately, even in a state like California, what we can see is that Big Oil and Big Industry have a stronghold on our political system,” says Jena Price.

Oil executive Les Clark doesn’t view the Democrats who killed AB 356 as politicians who yielded to industry persuasion, but as people acting from natural instincts. “I think they’ve got their heads screwed on right,” he says.

Also read these stories in our “Persuaders” series about corporate lobbying:

Arbitration Clauses: More Job Seekers Are Signing on a Crooked Dotted Line

Yoel Matute had worked at a Santa Monica car wash for seven years and was upset because he believed he wasn’t being paid for all the hours he worked. So in 2012 he decided to sue in court to recover his wages.

Matute soon got an unwelcome surprise. His employer attempted to enforce an arbitration agreement – an agreement Matute didn’t even know he had signed — preventing him from filing a lawsuit. Instead, the agreement mandated that the dispute be heard in arbitration, an out-of-court process that generally favors employers over workers like Matute.

When he had originally applied for his job Matute was handed what he thought was a work application. Some parts of the document were in Spanish, others in English. Matute, who is from Honduras and can read little Spanish and virtually no English, was given just a few minutes to review it, and he did not understand any of the sections in English. Car wash managers did not explain the document to him, but he understood he needed to sign it if he wanted the job. Nobody told him he was waiving his right to bring a workplace dispute to court.

“I had no idea that what I had signed was an arbitration clause,” Matute, 42, a thin, soft-spoken man who projects an inner strength, tells Capital & Main in Spanish. “I thought it was a work application and that I needed to sign the document the way it was presented to me or I would not be permitted to work at the car wash.”

He adds, “This is unjust. They took advantage of me and other workers because they knew I was in a vulnerable place and I need to support my family. I needed the work.”

In an arbitration, parties of a dispute present their claims to an arbitrator who then issues a ruling. In voluntary arbitration, parties of roughly equal bargaining power agree to submit their dispute to a mutually agreed upon resolution process. But job applicants, along with consumers purchasing goods and services, are increasingly being forced to sign agreements pertaining to any future dispute, unaware that their rights are being signed away.

Yoel Matute: I had no idea I had signed an arbitration clause.

Matute’s story is far from unique. A growing number of employers in California and nationwide are requiring new workers to sign mandatory arbitration clauses waiving their basic labor rights as a condition of employment — which means employees will not be hired if they do not give up their right to resolve employment claims in court or to even bring a dispute to the state Labor Commissioner. In addition, there are situations involving employees being asked to sign such waivers after they are hired, with arbitration agreements included in revised employee handbooks and even in severance agreements.

Mandatory arbitration clauses are often buried in the fine print of credit card and banking agreements, and require many workers to submit to a process designed solely by the employer – and to be bound by a decision made by an arbitrator who is paid directly by the employer. Low-wage workers like Matute are particularly vulnerable to such clauses, though they are also increasingly being used by high-tech companies and contractors in Silicon Valley.

That’s what happened to Rajan Nanavati, who testified about his experience before the Assembly Labor and Employment Committee earlier this month. Nanavati was hired in January 2014 through staffing agency Adecco to work as a dispatcher for Google Express. When he complained to the staffing agency’s human resources department that he was being forced to work nine to 13 hours without meal breaks, he was fired. He tried to file a class action lawsuit, but Adecco was successful in getting the case dismissed in court because Nanavati and other employees had signed arbitration agreements precluding them from bringing individual or class action lawsuits against Adecco.

“Mandatory arbitration is a cancer in our judicial system,” says Cliff Palefsky, a San Francisco-based civil rights and employment lawyer, who has testified before the U.S. House of Representatives Judiciary Committee on the issue of whether mandatory arbitration is fair to workers.

Adds Barry Broad, a Sacramento employment lawyer and labor lobbyist: “It is a tool of exploitation. It’s not really a tool intended to deliver even-handed justice.”

In an effort to ensure that any waivers of important employment rights are transparent, Assemblyman Roger Hernandez (D-West Covina) has introduced a bill that would ensure that such waivers be voluntary and given with the employee’s full consent. Assembly Bill 465 passed on an Assembly floor vote last week, and now moves to the state Senate.

In 2010, 27 percent of U.S. employers reported that they required private arbitration of employment disputes, covering more than 36 million workers. The percentage is higher today, according to some experts.

The Hernandez bill is being vigorously fought by the California Chamber of Commerce, which has put it on its “job killer” list. Other opponents include the California Association of Realtors, the California Farm Bureau Federation, the California Newspaper Publishers Association and the Western Growers Association.

“AB 465 will neither help California’s litigation agreement nor promote businesses’ ability to create jobs as it will drive up California employers’ litigation costs,” Jennifer Barrera, a Chamber policy lobbyist, wrote in a letter last month to Hernandez. The Chamber also argues that the U.S. Supreme Court and California courts have already authorized mandatory employment agreements, and that AB 465 directly conflicts with those rulings.

Hernandez’s supporters include the California Labor Federation, which is an official sponsor of the bill, as well as the California Teamsters Public Affairs Council, the California Employment Lawyers Association and the American Civil Liberties Union of California.

“It is an affront to the Legislature and a perversion of the law to allow employers to force employees and applicants to give up their legal rights as a condition of employment, Kevin Baker, the ACLU’s legislative director, wrote Hernandez in April.

In his letter, Baker said the system is unfair because the employer unilaterally picks its preferred arbitration company, and that that gives the arbitration firm a financial incentive to favor an employer who is a repeat player and the source of continued cases for the arbitration company. Also, private arbitrations are conducted in secret without public access or scrutiny; private arbitrators need not have judicial backgrounds or legal experience. Nor are they required to follow the law or rules of evidence, and there is no right of appeal to a court to review an arbitrator’s decision for legal errors.

“Tellingly,” Baker said in the letter, “companies often force their employees to sign mandatory private arbitration clauses but refuse to enter into such agreements themselves for disputes with other businesses—suggesting that employers do not truly believe that private arbitration is inherently better than the public justice system, but simply wish to protect themselves from responsibility for violating labor and employment laws.”

The issues involving mandatory arbitration have come under increasing scrutiny in recent years and some steps have been taken to protect workers. Last year President Obama signed an executive order prohibiting employers with federal contracts in excess of $1 million from requiring their employees or independent contractors to waive their right to a jury trial and agree, instead, to arbitrate a civil dispute, sexual assault or sexual harassment case.

In 2014 the California state legislature passed a narrowly defined bill that bars employers from forcing employees to give up their rights to have their civil rights claims heard in court. That bill applied solely to civil rights and hate crimes claims, and not the Labor Code. Hernandez’s bill attempts to build on that legislation to protect workers from waivers of labor code guarantees, such as minimum wage, overtime, meal and rest period protections.

Yoel Matute, the car wash worker, is a symbol of this battle. Though the courts eventually ruled that the car wash’s arbitration clause was “unconscionable,” partly because the employer didn’t give Matute enough time to review the agreement and because some portions weren’t translated into Spanish, he still is seeking the wages he says he is owed.

“The worker filed a lawsuit in 2012 and he still hasn’t had his day in court to resolve his claim for money that wasn’t paid,” says Justin McBride, campaign director for the CLEAN Carwash Campaign, a union organizing group. “The delay is because of the arbitration agreement.”

Three Strikes Reform: Proposition 47 and the Fight Against Inequality

When New York rapper Jay-Z played the Rose Bowl last summer, he surprised 90,000 concertgoers by making a political statement. Before launching into his hit “Hard Knock Life (Ghetto Anthem),” he urged fans to vote for a California ballot initiative that would dramatically reduce the state’s prison population and re-direct money into education and treatment programs.

“Prop 47, California! Build more schools, less prisons!” he exhorted.

A few weeks later, two other public figures delivered a similar rap, albeit in a different forum. In a Los Angeles Times op-edpiece, Newt Gingrich, the Republican politician, and B. Wayne Hughes Jr., a conservative Christian businessman, similarly urged Californians to end bloated spending on prisons and reverse tough-on-crime policies that they say have failed to significantly improve public safety. Among other things, Gingrich and Hughes pointed out that California now spends $62,396 per prisoner each year, and $9,200 per K-12 student.

Jay-Z: Props for Prop 47

The unusual alliance between progressives like Jay-Z and conservatives such as Gingrich comes as Californians are set to go to the polls next month to vote on Proposition 47, a ballot initiative that would re-classify several low-level nonviolent crimes such as drug possession and most theft involving less than $950 from felonies to misdemeanors. The vote will occur two decades after Californians passed a landmark tough-on-crime three-strikes law, which sentenced three-time felons to 25-years-to-life prison sentences, even if the third felony was for drug possession or a minor theft.

The United States has the highest incarceration rate of all industrialized countries, counting more than 700 prisoners for every 100,000 people. The U.S. Bureau of Justice Statistics reports that 30 percent of African-American males aged 20 to 29 are “under correctional supervision” — either in jail or prison, or on probation or parole. While a 16-year-old black teenager faces a 29 percent chance of spending time in prison during his life, the corresponding statistic for white men in the same age group is four percent.

Because our incarceration rates are especially high among young and vocationally unskilled boys and men of color (people who have the least power in the American labor market), the trend exacerbates racial and socioeconomic inequality. Prison sentences have detrimental and lasting effects on the job prospects of ex-offenders. The negative labor market effects of youth incarceration can last for more than a decade, and adult incarceration reduces paid employment by five to 10 weeks annually. Regardless of individual intelligence or ambition, a young man with a felony record faces enormous challenges in getting a good-paying job and leaving poverty.

Former prosecutor Lenore Anderson

“The tough-on-crime era led to a dramatic expansion of prison building — propped up by the myth about how to protect communities,” says Lenore Anderson, who is chair of the ballot committee of Californians for Safe Neighborhoods and Schools, the group spearheading the fight for Proposition 47. “Tough on crime is a failure.”

“Investing in treatment rather than throwing large amounts into mass incarceration is a smarter way of using public dollars,” says Barry Krisberg, a Senior Fellow at the University of California, Berkeley Law School. “Down the road it will further reduce crime rates in California.”

If Proposition 47 passes, thousands of people now incarcerated in California prisons would have their sentences reduced. The estimated savings to the state criminal justice system “could reach the low hundreds of millions of dollars annually,” according to the Legislative Analyst’s Office, with the savings re-directed to truancy and dropout prevention, mental health and substance abuse treatment, and victim services. In addition, counties across California could save several hundred million dollars each year.

Meanwhile, states across the country are re-examining tough-on-crime and mass incarceration policies.

“[Proposition 47] is in strong alignment with a nationwide change of attitude about our criminal justice spending priorities,” says Anderson. “Red states like Texas, Kentucky and North Carolina have already implemented reforms reducing prison spending.”

Newt Gingrich

Supporters of the initiative, including Carol Chodroff, a Los Angeles attorney and veteran juvenile justice advocate, say that mass incarceration policies such as California’s have diverted millions that could have been better spent on treatment and education programs and have resulted in harm and injustice to thousands of people, with a disproportionate effect on African-American and Latino groups.

“For too long, we have been throwing money away and wasting law enforcement resources by sweeping too many people – particularly young people in poor communities of color – into the criminal justice system for low-level, non-violent offenses, like simple drug possession and petty theft,” says Chodroff, a former staff counsel to the U.S. House of Representatives Committee on the Judiciary.

“Our penchant towards mass incarceration, and our corresponding failure to address or prevent the underlying causes of crime and delinquency, has had a destructive impact on neighborhoods, families and children across the state,” she says. “This misguided approach has contributed to widening racial and ethnic disparities in our juvenile and criminal justice systems; it is stunningly expensive and it doesn’t work.”

Among other things, Zimmerman says that if the ballot measure passes, stealing a gun worth less than $950 and possessing a date-rape drug will no longer be clearly tried as felonies. “This will undermine laws against sexual assault,” she says. And, she adds, “What message are we sending – that it’s okay to steal a gun if it’s less than $950?”

Anderson of Californians for Safe Neighborhoods and Schools disputes those views. A former San Francisco assistant district attorney, Anderson says that California has the strongest guns laws in the nation. “There are many ways in the penal code that anything relating to guns can be charged as a felony — as it should be,” she says.

She adds that the date rape scenario is also not true. “Using any substance to facilitate sexual assault is a felony. This initiative does not change that at all. This is just fear-mongering at its worst.”

Against Prop 47: San Diego police chief Shelley Zimmerman

In addition to Zimmerman, opponents of Proposition 47 include Democratic U.S. Senator Diane Feinstein, who said in an October opinion piece published in the Los Angeles DailyNews that the measure will make California less safe. The measure is also opposed by numerous police and other law-enforcement officials and organizations, including the California Police Chiefs Association and the California District Attorneys Association, as well as the California Republican Party.

Supporters include San Francisco District Attorney George Gascon, former San Diego Police Chief Bill Lansdowne, Netflix Inc. founder Reed Hastings and the Washington, D.C.-based Open Society Policy Center, the political arm of George Soros’ Open Society Foundations. And B. Wayne Hughes Jr., the conservative California businessman and philanthropist, has donated more than $1.2 million to support the measure. (Hughes became active in supporting prison ministry programs in California after meeting former Richard Nixon aide and convicted Watergate felon Charles Colson in 2009.)

The current effort comes as California has been ordered by federal courts to reduce its prison population and after repeated attempts to pass sentencing reforms have failed in the state legislature. Says U.C. Berkeley’s Krisberg, who has written about sentencing policy and was appointed by the legislature to serve on the California Blue Ribbon Commission on Inmate Population Management: “California is still struggling with a huge and troubled prison system, and the legislature and governor have been essentially incapable of supporting significant sentencing reforms. An initiative is the only way to go.”

Krisberg says he believes that “the chance of passage is extremely good,” for Proposition 47, partly because the initiative has the support of the general public and people and groups at different ends of the political spectrum.

“You have a confluence of libertarian conservatives who think government is wasting money and progressives who think the current system is overly harsh,” he says. Then, he adds, “I never thought I’d see the day when anything would be supported by both the rapper Jay-Z and by Newt Gingrich.”

Adelanto Report Card: Year Zero of the Parent Trigger Revolution

Throughout 2011 and 2012, the eyes of the education world were focused on Adelanto, a small, working class town in California’s High Desert. A war had broken out there over the future of the K-6 Desert Trails Elementary School and its 660 low-income Latino and African-American students. When the dust settled, Desert Trails Elementary was gone. In its place was a bitterly divided community and the Desert Trails Preparatory Academy, the first (and so far, only) school in California and the U.S. to be fully chartered under a Parent Trigger law, which allows a simple majority of a school’s parents to wrest control of a low-performing school from a public school district, and transform it into a charter school.

Tiny Adelanto’s turmoil reflects a much larger battle now being fought across America between defenders of traditional public education and a self-described reform movement whose partisans often favor the privatization and deregulation of education. At least 25 states have considered parent trigger legislation and seven of them have enacted some version of the law, including Connecticut, Indiana, Louisiana, Mississippi, Ohio and Texas. Though funded by tax dollars, the trigger charter is private, meaning it is not bound by many of the rules and much of the governing oversight or transparency of a traditional public school.

At the end of Desert Trail’s inaugural, 2013-14 school year, a group of eight former Desert Trails teachers hand-delivered a 15-page complaint to the Adelanto Elementary School District (AESD), charging Desert Trails with an array of improprieties and its executive director, Debra Tarver, with unprofessional and sometimes unethical conduct.

Among the most serious accusations are charges that administrative chaos at Desert Trails has resulted in both a stampede of exiting teachers and staff; that uncredentialed instructors have taught in its classrooms; and that Desert Trails had an unwritten policy of dissuading parents of students with special learning needs from seeking special education. The teachers also allege that they had to endure a bullying regime in which, they say, they were continually screamed at, spied on, lied to and humiliated in front of parents and their peers by Tarver and her deputies. Capital & Main spoke with the teachers, four of whom agreed to go on the record for this story. (“The High Desert is a small place and Debbie Tarver has a long reach,” said one teacher who requested anonymity.)

“Not only was it dysfunctional and unprofessional,” says second grade teacher Renee Salazar, a five-year veteran of Los Angeles’ inner-city public schools, “it was law-breakingly unprofessional.”

The teachers interviewed for this story, who were paid about $3,300 a month, claim the school’s extreme miserliness shortchanged teachers and students on basic classroom tools. Over the first year, they said they each spent up to a full month’s salary, and in some cases more, on unreimbursed, out-of-pocket expenses.

“At the start of the year,” recalled kindergarten teacher Bertha Miramontes, “I ended up spending $1,000 because the décor in my classroom, [Tarver] said, was not good enough. I would spend anywhere between $200 to $300 per month to get supplies — writing paper, pencils, construction paper, tissues for my kids’ noses, hand sanitizer, crayons.”

These teachers also say that Tarver, who as executive director of a charter school is paid a salary commensurate to that of a San Bernardino county school district superintendent by both Desert Trails and LaVerne Elementary Preparatory Academy — a combined annual salary of around $200,000 — ordered the student water fountains shut off for the duration of the bitterly cold High Desert winter, rather than pay for overnight heat to prevent the pipes from freezing.

When contacted by Capital & Main, Tarver dismissed the allegations of cheapness, along with the other former teachers’ charges, with which she said she was already familiar, as the sour grapes of “a couple of teachers who have been disgruntled,” though she admitted that Desert Trails’ budget was stretched thin.

“Last year was the first year of a school start-up. You don’t get all your funding right away,” she explained. “[But] every teacher was provided curriculum and everything they needed to operate a classroom. As a matter of fact, they had more than what my teachers had when we started at my other school.”

That other school is LaVerne Elementary Preparatory Academy (LEPA) in nearby Hesperia, where Tarver also serves as executive director. It was LaVerne’s impressive record at posting high assessment scores and its “old-school” model of a well-rounded, classical education that put Tarver’s Adelanto charter application at the head of the shortlist compiled by the Desert Trails Parents Union (the name of the Adelanto Trigger faction) and its sponsor, the Gates Foundation- and Walton Family Foundation-backed Parent Revolution.

Charter school critics, however, charge that such schools often raise their test scores by winnowing out special-needs students. Federal law requires all taxpayer-supported schools to admit students with disabilities. Schools are required to carry out an individualized education plan (IEP) for each disabled student, which could include extra tutoring or a placement in a smaller — and costlier — specialized classroom. Desert Trails’ charter application promised to accommodate the elementary school’s estimated 90 special education students by hiring “a Special Education Coordinator, three full-time special education teachers and five instructional aides.” In its first year, however, the Desert Trails Special Ed program consisted of a single teacher, Special Education Coordinator Tina Fryberger, and a sole classroom aide.

“We weren’t allowed to talk about special education to anyone,” third grade teacher Nani Colmer asserted and claimed she taught kids who needed special ed. “I had students that I really wanted to have a shot at some sort of academic success, and they could not get it in my classroom. I wasn’t allowed to talk about special ed except to say, ‘Go see Debbie Tarver.’”

Renee Salazar

“She told us, ‘Do not tell your parents that there’s any special education testing or assessments available,’” echoed Renee Salazar. “’Do not even talk about special education or testing for any of your scholars. If that ever arises, send them to the office, I will talk to them.’”

Tarver denied this. “Everything is done legally and accordingly as special ed is supposed to operate. The teachers are responsible for following a child’s IEP if the child has an IEP. A teacher, and that’s anywhere, cannot diagnose if a child has a disability unless that child has been tested.”

Miramontes said she was told by one parent that Desert Trails staff advised her that her bipolar-diagnosed and severely ADHD, five-year-old twin “would be better served elsewhere.” Miramontes described the kindergartener as prone to extreme rages that included punching, biting, throwing classroom furniture and, on one occasion, trying to scale the playground fence and run away. Eventually he was put in Fryberger’s Special Ed classroom, from where he was then “mainstreamed” into Miramontes’ class for an hour each day during lunch. But the violent tantrums continued and began to trigger outbursts in the child’s twin sister, who was one of Miramontes’ regular students.

“The [children’s] mom would come in my class,” recounted Miramontes, “and she would say, ‘This is what I deal with every day at home.’ She was like, ‘I need help. I’m asking for help from this school and they’re not helping me. I don’t know what to do.’”

According to Miramontes, things came to a head when, during one of the rages, the five-year-old struck school registrar Janice Dominguez. Miramontes never saw the child again but says that she was later told by the disbelieving mother that Desert Trails’ behavior specialist, Anthonie Etienne, requested that she remove her son from the school. When the mother repeatedly asked if the boy was being suspended, she said that Etienne would only reply, “No, he’s not being suspended. He just can’t come back to school.” Etienne has since left Desert Trails and was unavailable for comment.

However, Fryberger confirmed to Capital & Main the outline of Miramontes’ account, but both she and Tarver adamantly denied that the child — or any children — were requested to leave Desert Trails last year.

“That’s false,” Fryberger countered. “Upon discussion with the parents and staff members, [the] mom was in agreement that [her son] would need a more suitable environment to meet his needs. So this was not our decision as far as telling him that he wasn’t welcome or anything. This was a decision that mom thought was best for her kid.”

The teachers say that the parents of at least two other students were also persuaded that their children would be better served elsewhere.

The most telling outward sign that all was not right at Desert Trails, however, may be its startling turnover in administration and teaching staff. During its first year, teachers say, the charter lost a principal (Don Wilkinson) and a director (Ron Griffin) — both before the Christmas break — its vice principal, six classroom teachers and its behavioral specialist. In addition, only nine of Desert Trails’ first-year teacher roster — or 33 percent — are returnees this year. Desert Trails’ charter promises “less than five percent annual employee turnover.” And, teachers say, Desert Trails seems to be running true to form for the 2014-15 year, with four teachers jumping ship as of this writing — including two from the kindergarten level.

Tarver, who refused to discuss administration turnover, claimed the school’s overall staff retention, which includes uncredentialed classroom aides and office workers, was 92 percent. She attributed teacher turnover to the recovering economy.

“You have over 10,000 [education] jobs that opened up in the state of California,” she insisted, “whereas a lot of schools — not just mine, but many schools — have had a turnover because people wanted to move closer to their home base. . . . That has been the case in every school district, not only in the High Desert but all over California.”

At Desert Trail’s somewhat smaller but demographic twin, Adelanto Elementary School, 16 out of 21 teachers managed to find their way back this year, making for a roughly 76 percent teacher retention rate during the period of economic recovery.

The former Desert Trails teachers characterize the abundance of public school teaching jobs not as their reason for leaving Desert Trails, but as a means of escaping what they say became an increasingly unbearable and capriciously erratic place to teach.

“We were always getting conflicting information from our superiors,” Salazar said. “I was told by multiple different supervisors what things were okay to do. Second grade was told, ‘Do not use Treasures,’ which is the core reading curriculum. It includes phonics, spelling, grammar, writing, components of social studies, science and all of your reading and reading comprehension strategies. So for months at a time, we improvised; we used other support material, we tried to hit every standard to the best possible way that we could without using that curriculum. And two months later, Debra Tarver comes in and says, ‘Oh my god, why aren’t you using Treasures?”

Rachel Garvin Villarreal

“We were all getting really stressed out,” confirmed third grade teacher Rachel Garvin Villarreal. “There were so many mixed messages from the different parts of administration, and having so much changeover in administration, you never quite knew who your boss was, and you didn’t get the guidance that you wanted.”

“They just told lies to cover themselves over and over and over again, and they contradicted themselves left and right,” said Nani Colmer. “So many things were done in defense of things that they did in the past, and then we paid the price for it.”

One of those lies appears to involve teacher credentialing.

The state’s education code is explicit on credentials. Section 47605(l) requires that “Teachers in charter schools shall hold a Commission on Teacher Credentialing certificate, permit, or other document equivalent to that which a teacher in other public schools would be required to hold.”

However, the online database of the state’s Commission on Teaching Credentialing (CTC), indicates that for 2013-14 Desert Trails kindergarten teacher Elfie Landa didn’t receive a preliminary Multiple Subject credential until July 24 of this year. (Landa left Desert Trails during the current term.) And the database turns up only an emergency, 30-Day Substitute Teaching Permit (issued March 21, 2014) for Honey Welker, a third grade level teaching lead last year, who took over Colmer’s third grade classroom mid-year.

Tarver refused to confirm or deny that she used uncredentialed teachers in the classroom last year, and instead insisted repeatedly that Desert Trails passed a credentialing audit conducted by the Adelanto Elementary School District last April.

Then there is the matter of the composition of Desert Trails’ five-member board of trustees.

As with the publicly elected school board of a traditional school district, which sets the policies that the superintendent must then carry out, the independence of a charter school’s board is a critical check and balance —a guarantee that the voice of parents will be heard and respected by the school administration.

The school’s former teachers who publicly question the Desert Trails board’s autonomy said they were long suspicious of the secrecy that seemed to surround it, noting that, unlike most charters, neither its composition nor its meeting minutes could be found anywhere on the school’s website.

When asked by Capital & Main, Tarver volunteered the board members’ names, adding that the membership was on record at AESD. She also added an unequivocal denial when asked about teacher suspicions that its members were employed by either Desert Trails or LEPA, which Tarver also runs.

However, not only is board member Latrice Brown listed on LEPA’s own website staff roster as a “parent liaison,” but an online search of LEPA’s federal 2012 IRS Form 990 tax return revealed that two Desert Trails board members are listed as LEPA company officers — Marnella Mayberry as president and Ruby Ford (who also works as a tutor at both schools) as vice president.

What mostly angered the ex-Desert Trails teachers, however, was what they characterized as the cumulative betrayal of the education promised to the parents and children of Adelanto.

Renee Salazar said she was drawn to Desert Trails by Tarver’s sales pitch about unlimited resources and classroom freedom, and the opportunity to innovate curriculum.

“For a while, at least, we had that,” Salazar said. “But all that changed after the winter break when the school began ramping up for the spring assessment testing. We had a director that was telling us, ‘You can create your own curriculum.’ We were told there wasn’t going to be a test-prep focus. But from February on, there was.”

Salazar said the pressure fell heaviest on the second grade, which the administration considered the “giveaway year” — the grade that could usually be relied on to bring in a high score and help raise the school’s overall Academic Performance Index. The second grade class of 2013-14, however, was measuring as low as kindergarten level for math and language arts.

“We were told, ‘You have to get their test scores up,’ Salazar remembers. “Our vice principal was told, ‘If their test scores don’t come up, you won’t have a job.’ So they sat all of second grade down and said, ‘You’re no longer allowed to teach writing, you’re no longer allowed to teach social studies, science — anything else. No P.E. You’re only to [teach] language arts and math. This is the schedule that you’re to do it on, these are the only materials that you’re allowed to use, this is how you’re to do it.’”

One thing on which the two sides do agree is that Desert Trails did post test-score gains.

“We had 47 percent of our scholars who [rated] proficient and advanced,” Tarver said of the California Standards Test results for 5th grade science, “and we only had a 15 percent rate of those that were below and far below [state standards], which is a huge difference from the 30 to 40 percent that school had for the past 10 years.”

More comprehensive, schoolwide scores, she said, wouldn’t be released by the school for another month.

For the ex-teachers, it is a tarnished achievement that came at the terrible price of shattered morale and the stability and consistency that underpin a quality education.

“It wasn’t the holistic, well-rounded education that they were promised,” Salazar asserted. And [teachers leaving] is difficult. It’s hard on the scholars and it’s hard on their families.”

At least one parent who spoke to Capital & Main on the condition of anonymity agreed.

“I don’t know what’s going on,” this parent said. “I feel like so many teachers have left. There’s been, like three principals that left, and every time you ask somebody about it, they just make it seem like it’s no big deal. But when kids are in school, consistency is important.”

“When teachers are able to stay multiple years,” Rachel Garvin Villarreal noted, “they become part of that community and make an even stronger, healthy school culture that over time grows. . . . And even though we had invested so much, I guarantee you, we would have invested so much more.”

“We’re not trying to get even,” Miramontes said of the teachers’ complaint. “We just really care about those kids and just want the best for them. I mean, they don’t even have soap and paper towels in the bathroom! Kids deserve better than that.”

High Noon for Parent Trigger?

Whether or not Parent Trigger represents a bold frontier in the movement to privatize the nation’s public education system, its implementation in California’s High Desert does bear some of the freewheeling aspects of the old Wild West.

Particularly when it comes to accountability and due process. Where do parents or teachers blow the whistle if they suspect a charter school is violating education code or the promises made to students in its own chartering language?

In California, the chartering school district has the statutory authority, and arguably the responsibility, to investigate violations of the law and of the school’s charter. Under Education Code §47607, it may revoke a school’s charter if the school violates the law or violates the conditions set forth in its charter.

Eight former Desert Trails teachers have emphasized to Capital & Main that it was only after frustrated parents told them that Parent Revolution said they were on their own in working out any grievances directly with Desert Trails that the teachers stepped in and took their own allegations of code and charter violations to the school’s chartering authority, Adelanto Elementary School District (AESD).

When asked to comment on the teacher allegations, however, AESD at first claimed to “not have first hand knowledge” of the document, then said it couldn’t be certain whether it received it or not. After three weeks of back-and-forth queries, officials eventually admitted that they had simply sent the allegations on to Desert Trails.

“The District forwarded the complaint to [Desert Trails] and directed [Desert Trails] to respond appropriately to the complaint,” wrote AESD chief personnel officer Steven L. Desist, adding that “District staff and I have been advised by Ms. Debra Tarver, [Desert Trails’] executive director that she immediately addressed the concerns set forth in the complaint to the satisfaction of the complaining party.”

The teachers say they have never heard from Tarver or spoken to the school about addressing their complaints.

Parent Revolution spokesman Gabe Rose admitted to Capital & Main that “we have certainly heard of complaints and problems, as is the case at any school, and we have always worked to help resolve those issues as best we can. Sometimes that means helping organize parents to push the school on an issue, sometimes it means helping to facilitate a conversation between parents and the school to work through a disagreement.”

In the instance that push does come to shove, however, Rose advised that the next links in the oversight chain are “the district and its school board, the board of the charter school, and in the case of an alleged violation of the education code, the California Department of Education.”

For concerned parents, however, taking grievances directly to Sacramento — or speaking out at all — may be asking a lot of the low-income and often undocumented immigrants who make up three-quarters of Desert Trails parents.

Former Desert Trails kindergarten teacher Bertha Miramontes, who lives in Adelanto, added that even the parents who most wanted to come forward eventually had second thoughts.

“The parents,” she told Capital & Main, “said they are just afraid to talk, period, to anyone, because they don’t want their kids retaliated against or they don’t want the school to be shut down.”

Bay Area Cities Set Sights on Raising Their Minimum Wage

OAKLAND – The growing nationwide movement by cities and counties to raise the minimum wage is currently centered here in the Bay Area, and its success couldn’t be more urgent for workers like John Jones III.

Jones, 40, is a licensed aircraft mechanic but works as a Burger King security guard in downtown Oakland, making $10 an hour — $1 more than California’s minimum wage. His life is a series of financial challenges and daily indignities as he struggles to support his wife D’Nita, his 12-year-old son Kai and his newborn boy, Josiah.

To take a shower in his apartment, Jones has to use pliers to turn on the water because the knobs are broken. He can’t complain to his landlord because he’s behind on the rent. When his family runs out of toilet paper, Jones cuts paper towels into quarters to save a few bucks. He covers the windows in his bedroom with blankets because he can’t afford curtains. To cut down on the water bill, he and his wife only wash their dishes every three or four days. And in the past several months, he’d often skipped meals so that his pregnant wife had enough to eat.

“The idea that people have to live like this in America, in the Bay Area no less,” is disheartening, says the six-foot-two-inch Jones, who still looks like the local high school basketball player he once was. He speaks without a scintilla of bitterness and says that the worst aspect of his job is “the disrespect — when you hear ‘minimum wage worker,’ most people think of teenagers or people who are losers. We’re vilified. People come in with the attitude that ‘You guys are losers’.”

“That stings,” says Jones, who sometimes washes down the sidewalk outside the Burger King and cleans tables inside the restaurant, in addition to his security duties. “People look at us like we are next to nothing. We are just people who are trying to provide for our families.”

In many ways, Jones represents the new face of the low-wage worker at a time when cities and counties across the nation are adopting or considering laws to raise minimum wages to reflect local economic conditions and living costs. So far, 13 cities and counties have approved such minimum wage laws, with Seattle gaining national attention this June when it approved a minimum wage of $15 an hour, to be phased in over several years. The local initiatives come as the federal minimum wage has been stuck at $7.25 an hour since 2009.

“There has been increasing inequality and, at the bottom, stagnating wages in the last decade,” Ken Jacobs, chair of the University of California, Berkeley, Labor Center, says in an interview with Capital & Main. “Minimum wage increases are one tool to bring up that bottom.”

Next month voters will decide separate ballot measures to raise the minimum wage in Oakland and San Francisco. Oakland’s ballot initiative, Measure FF, would raise the minimum wage to $12.25 an hour and require employers to offer at least five days of sick leave to all employees. In San Francisco, which was the first city in the country to pass a minimum wage law in 2003, residents will vote on an initiative, Proposition J, to gradually raise the minimum wage from the current level of $10.74 an hour to $15 by 2018, with guaranteed cost-of-living increases.

On average, workers in San Francisco would see their annual earnings increase by about $2,800 a year and those in Oakland would receive annual increases of approximately $2,700.

The city councils of two other Bay Area cities, Berkeley and Richmond, have voted to increase their city wages to $12.53 an hour by 2016 and $12.30 an hour by 2017, respectively.

Moves have also been underway in Southern California to raise the minimum wage. In San Diego, the city council voted to increase the city minimum wage to $11.50 per hour by 2017. Los Angeles Mayor Eric Garcetti has proposed a minimum wage of $13.25 an hour and the city council recently voted to raise hourly pay for 10,000 hotel workers to $15.37 an hour by mid 2015.

“California is the hotbed of this movement” to raise the minimum wage, says Annette Bernhardt, a visiting professor at the University of California, Berkeley’s sociology department and a scholar of low-wage work, speaking at a conference late last month at U.C. Berkeley’s Institute for Research on Labor and Employment (IRLE).

According to IRLE studies, an increase in the minimum wage would significantly benefit black, Hispanic, Asian and other workers of color in Oakland and San Francisco. In Oakland, for instance, blacks, Hispanics, Asians and other ethnic minorities make up 62 percent of the workforce, but represent about 79 percent of workers affected by the proposed wage increase. In San Francisco, workers of color make up about 54 percent of the total workforce, yet represent about 71 percent of workers affected by the proposed wage increase.

Avery Dollar, a 28-year-old African American and a single mother of a six-year-old daughter, is typical of those who would benefit. Dollar makes $9.25 an hour as a cashier at Foods Co. grocery store in Oakland. She says a raise would allow her to cook healthier meals instead of cheap processed foods like the corn dogs and chicken nuggets that she pops in the microwave. “It’s gross but we have to eat every day,” she says, adding that a raise in the minimum wage would “make my life so much easier and less stressful.”

Bing Rong Tan, 42, immigrated to the United States three years ago from China’s populous Guangdong Province with his wife and now-14-year-old son. He had hopes of providing his son with a better education. Tan makes $14 an hour directing pedestrians around a hospital construction site in San Francisco’s Chinatown and works about 25 hours a week. His wife makes minimum wage folding clothes at a retailer. The family lives in a tiny, cramped space of about 100 square feet Single Resident Occupancy (SRO) hotel in Chinatown; SROs are residential spaces with a shared bathroom and kitchen that were built and intended for single bachelor workers.

“My experience [in coming to the United States] is very different than what I expected,” says Tan, speaking through an interpreter. “Finding work is a lot harder than I thought. The cost of housing is much higher than I thought. There is such a difference between what we make and what we have to pay for rent and living expenses.”

Like other low-wage workers, Tan says that an increase in the minimum wage won’t allow him to radically change his life, but it will help. “Having a little more every year is important because the rent keeps going up,” he says.

In the Bay Area, opposition to the minimum wage initiatives has been low key.

Gwyneth Borden, executive director of San Francisco’s Golden Gate Restaurant Association, says her group doesn’t like the local initiatives because the measures don’t include an exception for waiters and bartenders, who generally make minimum wage but also get tips. But she says that the association is officially “neutral” on the initiatives.

“We recognize that low-wage workers need a raise,” she tells Capital & Main, but adds, “we would have liked it done differently.”

The initiatives’ supporters acknowledge that restaurant prices will rise slightly if the minimum wage goes up, but they say the price rise would be small. A $10 meal would increase by 27 cents if San Francisco’s measure is adopted, according to one study.

Nonetheless, not all restaurant workers support the minimum wage measures. At Oolong Noodles and Sushi, on Washington Street in San Francisco’s Chinatown, David Kuang, a 27-year-old waiter, says that “It’s no good for the restaurant. If wages are raised, then people will lose their jobs.” He says that he also worries that if wages are raised, restaurants will raise their prices and “people won’t come to eat.”

Opposition has also come from the San Francisco Council of District Merchant Associations, which represents local businesses. The group said in an August press release that the cost of services and commodities will increase, that instead of creating more jobs the opposite will be true and that San Francisco’s fledging manufacturing industry will probably move away.

The Labor Center’s Jacobs says that the research shows otherwise.

“The research here is strong – minimum wage increases have not had an affect on employment or hours.” He adds that research has shown that the costs of San Francisco’s 2003 minimum wage hike were absorbed through decreased employee turnover, improvements in worker performance and small, one-time increases in restaurant prices.

If the measures are adopted, they will affect tens of thousands of low-wage workers in the Bay Area, with pay raises for an estimated 142,000 workers in San Francisco and another 40,000 workers in Oakland. John Jones, the Oakland Burger King security guard, says the raises will be meaningful.

“It will give all of us a breather,” he says. “It will allow me to spend time with my sons” instead of having to work at a second job. “I’ll sleep a little better at night.”

“This isn’t my story alone,” he adds. “It’s the story of 40,000 other workers.”

Cyber Charter School Revolt Against K12 Inc. Continues

The latest sign that the nation’s 14-year romance with the for-profit cyber charter industry might be cooling came last week when the Board of Trustees for Pennsylvania’s scandal-plagued Agora Cyber Charter School discussed completely severing its relationship with K12 Inc., the nation’s largest for-profit cyber charter management and curriculum supplier.

The action came nearly three weeks after an August 5 vote by Agora’s board to not renew its management contract with the online learning giant beginning with the 2015-16 school year.

Agora had been the jewel of K12’s 29-state network of virtual charters, accounting for 14 percent of the company’s annual revenues of $848.2 million. So when news of the August 5 decision came to light during an August 14 K12 Fourth Quarter investor conference call, it sent K12’s high-performing stock into a nearly 13-point tailspin. The call-in’s moment of revelation can be heard here:

This spring’s formal opinion by New Mexico’s Attorney General that a Farmington, NM-based K12 affiliate is in violation of a state law forbidding a for-profit company’s involvement in managing a charter school.

April’s decision by the National Collegiate Athletic Association (NCAA) that it would no longer accept coursework from 24 virtual charters that use K12 to provide their online curriculum, including both Agora Cyber Charter and California’s largest online charter network, the California Virtual Academy (CAVA).

Math teacher Michael McNulty is a five-year Agora cyber high school veteran who logged onto both of the charter’s virtual August board meetings. His understanding of the board’s rationale, he told Capital & Main, was for it to take on self-management and consider another online curriculum vendor — Agora’s continued affiliation with K12 had become a political liability in getting Agora’s five-year charter renewed by Pennsylvania this year.

“That application is going out soon,” McNulty noted. “Mary Steffey, the [Agora] board president, [told Agora’s staff] that, ‘Becoming self-managed puts us in a better position to be re-chartered by the state.’ And she had said that [in] the current conversations that are happening between the Pennsylvania Department of Education and the Agora board . . . without K12, our application looks better.”

In a statement released to Capital & Main, Steffey confirmed that the Agora board hadn’t made a final decision regarding its curriculum services contract with K12 but otherwise refused to publically comment on the political considerations behind the board’s thinking.

“Agora’s Board of Trustees cannot speculate about how the Pennsylvania Department of Education will perceive the Board’s actions when Agora seeks renewal of its charter,” said Steffey’s statement. Nevertheless, she added that “the Board hopes that PDE will appreciate the Board’s efforts to make informed and reasoned decisions and the Board’s commitment to the success of the School and its students.”

Another consideration behind the Agora board votes may have been this year’s Pennsylvania gubernatorial election. McNulty points out that with Republican governor Tom Corbett, who supports cyber charters, trailing “epically bad” in opinion polls, being tied to a failing for-profit education company would certainly not help the school.

“The board had a report from the K12 lobbyist about what was happening in Harrisburg,” McNulty said, referring to the state’s capitol. “They did talk about what would happen if Corbett was not reelected.”

Neither K12, the company started in 2000 by former banker Ronald J. Packer and convicted junk bond king Michael Milken, nor Agora Cyber Charter, founded in 2005 by Dorothy June Brown, is a stranger to controversy.

Brown is currently facing retrial on 54 counts of an original 62-count, $6.7 million fraud indictment in federal court that stems in part from her financial dealings while at Agora. And a 2011 investigation by the New York Times that was highly critical of both Agora and K12 noted that nearly 60 percent of Agora students were behind grade level in math, nearly 50 percent trailed in reading and a third failed to graduate on time. That report was seconded by the findings of a 2012 study of K12 by the University of Colorado’s National Education Policy Center.

Those and other negative accounts of K12 student outcomes led to the filing of at least one investor lawsuit against the company claiming that K12 intentionally misled investors about its academic quality when then-CEO Packard claimed, during an investor call, that test results at Agora were “significantly higher than a typical school on state administered tests for growth.” In fact, the most recent data on Agora students at that time showed them testing unfavorably compared to students statewide.

It’s a pattern of evasion that appeared to be at work once more during the K12 August 14 conference call. Nine days after the Agora board decision to self-manage, neither current K12 chairman Nate Davis, president Timothy Murray or chief financial officer James Rhyu mentioned the Agora management contract vote until 24 minutes into the call — and only then in response to a direct question from Corey Greendale of the Chicago investment firm First Analysis.

(K12 did not respond to requests for comment.)

For his part, McNulty, who has been a vocal critic of the stiff cut K12 takes out of the average daily attendance tuition money paid to Agora by the state — around 60 percent, he estimates — applauds Agora’s board decision to oust K12 and take a hands-on role in school management. He hopes that the freed-up money can be used for better instructor pay, teacher recruitment and, ultimately, smaller class sizes.

“I think it brings the school closer to what the spirit of the charter should be,” McNulty said. “Association with K12 is like having Walmart come in. … It’s just antithetical to what I think parents and boards want and need out of a charter.”

He is not alone. How the Agora decision to self-manage plays out is being closely watched by the 750 teachers of California Virtual Academy (CAVA), the state’s largest cyber charter, who share many of McNulty’s concerns about working under K12.

“We have a smaller pot to pull from if we’re sending a lot of money to K12,” says nine-year CAVA high school teacher Cara Bryant. “It’s a very difficult and frustrating thing when a student’s computer isn’t working or a teacher’s computer isn’t working. It simply handicaps you. I started with CAVA in ’06 and I had the same computer for six years. And it got so slow that I started having to use my personal computer for work, because I literally was unable to run some of the programs I needed to run to do my work.”

Sarah Vigrass, an eight-year CAVA K-8 teacher, points to the frustration over the lack of parent and teacher policy input and the outflow of state tuition money to K12 as two of the reasons behind teachers’ recent efforts to organize a union at CAVA. (Disclosure: The union, California Teachers Association, is a financial supporter of Capital & Main.)

“I don’t know that that’s best serving our students,” she told Capital & Main. “For example, a couple of years ago, [K12] got rid of science textbooks and the parents complained about it. And instead of bringing back a physical science textbook, K12 took away our math textbook. With nothing against online publications, parents that are teaching their kids like to have a physical textbook so they can flip back and review easily, or if they’re travelling, they can have that with them.”

“That’s why,” Vigrass adds, “I’m a teacher — to be able to give the best and most time to my students. And I feel like I’m not able to do that. And, again, that goes back to so much money being funneled out of state that CAVA doesn’t have enough resources.”